Issue - decisions

11.1

To agree a programme of investment for Leisure and Entertainment services and agree the preferred management option for the future operation of facilities.

11.2

RESOLVED: That Co-operative Executive:-

1.    Note the ending in 2024 of the arrangements with Sheffield City Trust around the Major Sporting Facilities (Arena, Ponds Forge and Hillsborough Leisure Centre);

2.    Approve the investment in our Leisure and Entertainment facilities to deliver a balanced and sustainable portfolio of facilities which support the needs of our communities alongside elite sport and events (Investment in the facilities);

3.    Note this gives an opportunity for the Council to review how leisure and entertainment services are delivered in Sheffield and approve the strategy of a Council commissioned (but market driven) approach to appointing an external partner, as outlined in this report (Who runs the facilities);

4.    Delegate authority to the Director of Culture in consultation with the Leader of the Council, the Director of Finance and Commercial Services and the Director of Legal and Governance to approve procurement strategies to deliver the strategy and to award any associated contracts;

5.    Note phased delivery of this strategy will be approved via the Council’s capital programme;

6.    Note the programme of public consultation to inform the investment in facilities at a local level;

7.    Note work will begin to address backlog maintenance issues at the following facilities:

a. Ponds Forge International Sports Centre

b. English Institute of Sport Sheffield (EISS)

c. Ice Sheffield

d. Heeley Pool and Gym

e. Beauchief, Birley and Tinsley Golf Courses

f. Sheffield Arena

g. Sheffield City Hall;

8.    Note that backlog maintenance will also be addressed at Upperthorpe Healthy Living Centre which is currently run by Zest;

9.    Note work will be undertaken on creating a lifecycle maintenance investment fund for Leisure and Entertainment facilities; and

10. Note the implications in (the closed) Appendix 1 and that further work will be done to inform how that can be progressed.

11.3

Reasons for Decision

11.3.1

The council recognises that leisure provision will be critical post Covid-19, with many people requiring rehabilitation after suffering long-COVID, or diminished mental health caused by lockdown. The health and wellbeing of residents is a priority, and it is clear the services delivered by leisure play a vital role both now and in the future. It is therefore critical that a long-term management and investment strategy is put in place to secure the future of the leisure and entertainment portfolio.

11.3.2

It is expected that investment into new and improved facilities will help to attract and retain increased participation and usage of venues. Improved facilities will better meet customer expectations of a modern and welcoming leisure and entertainment offer. This will help to reduce barriers to participation and encourage more people to be more active, more often.

11.3.3

Investment in Leisure will improve financial viability and long-term sustainability of the service and ensure that facilities are modern and accessible. New facilities will also help to deliver against the Council’s commitment to the climate emergency by improving the environmental sustainability of facilities.

11.3.4

Investment in new facilities will also improve equality of access ensuring that facilities are designed to be fully accessible and inclusive.

11.3.5

There is a clear financial link between the amount of money the Council can invest and the operating model selected. The greater the income the operator generates, the more money the Council can safely invest. It is therefore critical that the Council selects the management option that provides the greatest level of income, and that the decision on the future management option is taken alongside the decision to invest.

11.3.6

The Leisure Review has shown that the external partner model is the most financially advantageous and returns the highest level of income. This is because an external partner is likely to benefit from existing regional management structures which means that central overhead cost such as senior management, central administration, HR and payroll attributed to the delivery of services will be lower. In addition, a specialist external partner is likely to be able to deliver economies of scale on procurement supplies and services and have stronger marketing expertise to generate sales and therefor increase income.

11.3.7

The external partner model also provides the greatest financial certainty as the least financial risk as a management fee would be set as part of the contract procurement and financial risk can be transferred to the external partner.

11.4

Alternatives Considered and Rejected

11.4.1

Alternative Management Model - The Council has reviewed three possible options for the future management of facilities, as described in 1.3. This included in house, a Local Authority Trading Company (LATC) and appointment of an external partner. The in house and LATC options were not selected as they are more expensive and present a greater level of financial uncertainty and risk to the Council. They would not allow for the level of investment needed for the Council to offer significantly improved leisure facilities.

11.4.2

Do Nothing - Doing nothing is not an option. The current arrangement with Sheffield City Trust come to an end in 2024 and the facilities themselves require significant investment just to remain open and functioning. Without investment facilities will continue to decline and eventually close.

11.5

Any Interest Declared or Dispensation Granted

None

11.6

Reason for Exemption if Public/Press Excluded During Consideration

None

11.7

Respective Director Responsible for Implementation

Interim Executive Director, Place

11.8

Relevant Scrutiny and Policy Development Committee If Decision Called In

Overview and Scrutiny Management Committee